July 27, 2021 | Buying
The Summer Low: What Is Happening In Real Estate Right Now?
In a hot seller’s market it’s hard to imagine any noticeable market fluctuations, but every summer (except for the record breaking summer of 2020) we see a seasonal summer low in the Toronto Real Estate Market.
Like any industry, real estate experiences peak times and slow times. Historically, the seasonal low times will almost always come after a very busy season like spring and fall. In Toronto these lows are usually in July until late August and December until late January.
Seasonal lows occur for various reasons:
1) Buyer fatigue
After a busy season of house hunting and losing offers, home buyers are burnt out and often need a complete break from the house hunt. During these months, there is a significant drop in new listings as well as buyers. As a home buyer, if you can push through the fatigue, have a broad list of what you’re looking for, this could be a good time to buy with less competition. As a seller, these summer months are not the optimal time to sell your house with an expectation of multiple offers and a record price.
For buyer tips read Top 3 Things Every Toronto Home Buyer Must Know in 2021!
2) Popular vacation periods
The summer season in Toronto is so short, people are often less excited about getting their house ready for sale or house hunt when you could be at the beach or up at a cottage? In the winter, December and January are also prime times to catch up with family, fly down south, adjust to the colder weather and generally take a break.
3) The cold weather
Although not the main factor for Toronto’s real estate lows, the cold weather will have an impact on the start of the spring and fall seasons. For example: in November, as the fall market is winding down, we could see a longer than usual busy season if the weather stays warm. However, if early snowfall and cold temperatures hit, we will see early signs of human hibernation. Same goes for late January, if we are having a brutally cold, snowy winter, we will most likely not see new listings until mid to late February.
Understanding and tracking these seasonal market fluctuations is the absolute best way to buy smarter and maximize the sale of your house or condo. Having access to sold price data, and how long properties are remaining on the market, is indispensable knowledge everyone should have before making a decision to buy or sell.
So what’s happening in the Toronto Real Estate Market Now?
By mid-January 2021, the market was in full speed and we were seeing 15-20 offers on homes and record breaking prices. Near the end of May, warmer weather returned and buyer fatigue kicked in, we started seeing a shift in the market as there were less active buyers and homes were getting fewer offers on offer day. Although home prices didn’t actually drop, they also did not increase at the rate seen earlier in the year – We are seeing a flattening of the upward pricing curve, not to be confused with the bursting of the real estate bubble. This is not happening.
For more information on the Toronto real estate market check out this recent blog post.
We are currently in a summer market low
There are fewer buyers shopping for homes, fewer multiple offer scenarios, yet homes are still selling for high, but not obscene prices (relative to earlier in the year). The Toronto housing market is always hot, even when it’s cool. There is no such thing as a sleepy market, in Toronto at least.
The fall real estate market is only weeks away and will typically pick up near the last week of August to the first week of September. This is when we start to see a momentum shift and by the 3rd week in September the season is in full swing. The ideal time to hit the market is between late August to the beginning of September. The advantage here is that there are still relatively few homes for sale, yet buyers are starting their house hunt. If selling your home is on your to-do list for the coming year, we suggest prepping your home during the summer, so it is ready to shine ahead of the busy fall market.
See our blog on 4 Reasons To Consider Selling Your Home In The Fall
We often find that house hunters who made one or more unsuccessful offer in the spring, tend to come back to the table in the fall determined to make a winning bid. The 2020 to 2021 real estate year has not been without its challenges, and has possibly been the most difficult to predict thus far. However, we feel confident that fall 2021 is shaping up to be yet another record breaking season in Toronto Real Estate.
